2025 in UK Carbon Removal: Policy Progress, Delivery Gaps, and What Comes Next

Written By Oluwaseun Sanni

The UK made more progress on carbon removal policy in 2025 than in the last couple of years combined. But the gap between policy ambition and actual tonnes removed remains wide. Here is what happened, what it means, and what to watch in 2026.

The policy framework is now in place

Three announcements in 2025 are looking to shape the future of UK carbon removal.

1. Carbon removals will enter the UK Emissions Trading Scheme

In July 2025, the government confirmed that engineered greenhouse gas removals will be integrated into the UK ETS by 2029. Legislation is expected by the end of 2028.

The key parameters:

  • Only UK-based projects will be eligible initially

  • Projects must demonstrate a minimum 200-year carbon storage period

  • Credits will be issued only after removal has occurred and been verified

  • Removal allowances will replace emissions allowances on a one-for-one basis

This makes the UK one of the first countries to set out exactly how engineered carbon removal will work within a national compliance market.

The UK ETS cap is falling from 156 million tonnes of CO2 equivalent in 2021 to approximately 49 million by 2030. Maritime emissions join the scheme in 2026, waste incineration in 2028, and greenhouse gas removals in 2029.

2. The GGR Business Model was published

In August 2025, the government released its commercial framework for carbon removal projects. At the centre is a 15-year Contract for Difference, which guarantees a revenue stream for developers.

Under the scheme, projects receive the difference between a negotiated strike price and the market price of carbon credits. If sales exceed the strike price, developers pay back the difference.

Currently, only BECCS (bioenergy with carbon capture and storage) and DACCS (direct air carbon capture and storage) projects qualify for support. Biochar and enhanced rock weathering are not yet included in the business model.

3. BSI published interim methodologies

In July 2025, the British Standards Institution released Minimum Quality Thresholds for BECCS (BSI Flex 2006) and DACCS (BSI Flex 2007). These set the baseline requirements for what counts as a credible removal.

Full UK GGR Standards are expected by 2027. For now, there is no UK-specific methodology for biochar or enhanced rock weathering. The Independent Review of Greenhouse Gas Removals, published in October 2025, recommended that the government endorse existing standards such as the European Biochar Certificate in the interim.

The funding commitment

In October 2024, the government committed £21.7 billion to carbon capture, utilisation, and storage over 25 years. This covers both industrial carbon capture and engineered removals, with £9.4 billion allocated in the 2025 Spending Review.

The official target is 5 million tonnes of engineered removals per year by 2030.

Looking further ahead, the Climate Change Committee projects that the UK will need 58 million tonnes per year of engineered removals and 39 million tonnes per year of nature-based removals by 2050.

The UK carbon removal sector: small but growing

According to analysis by CO2RE (the UK GGR Hub), Oxford Net Zero, ERM, and the Green Finance Institute, the UK is home to at least 80 carbon removal companies. These span DACCS, BECCS, biochar, enhanced rock weathering, and ocean-based methods.

Several notable developments occurred in 2025:

  • First UK-made carbon removal credit: In June 2025, Restord delivered and retired the first UK biochar carbon removal credit, verified by CapChar, for Bennetts Associates.

  • First UK BECCS project on a major registry: In December 2025, an English BECCS project became the first UK project from the sector to be listed on Puro.earth.

  • UK's largest biochar facility announced: Pure DC committed £24 million to develop a facility in Wiltshire, operated by A Healthier Earth. The facility is expected to produce 11,500 tonnes of biochar per year and remove up to 18,500 tonnes of CO2 annually.

  • Black Bull Biochar raised £4 million: In December 2025, the company secured late seed funding co-led by TSP Ventures and Greater Manchester Combined Authority Investment Fund, supporting expansion across Northwest England and entry into Denmark.

  • Shropshire's second biochar facility approved: The Ludlow pyrolysis facility was approved in 2025 and is expected to be operational in early 2026, producing approximately 1,000 tonnes of biochar per year.

  • The Carbon Removers targeting £1 billion: The Scottish company aims to remove 1 million tonnes per year by 2030, having already captured over 80,000 tonnes since 2012.

The delivery gap

Globally, biochar dominates actual carbon removal deliveries. As of late 2025, 86% of all durable CDR credits delivered and 92% of credits retired worldwide came from biochar projects.

Yet in the UK:

  • No large-scale engineered removals have been recorded

  • The business model only supports BECCS and DACCS

  • No UK-specific methodology exists for biochar

  • First CCUS cluster operations are not expected until 2028

The 5 million tonne per year target by 2030 requires significant acceleration from what is currently a near-zero baseline.

What to watch in 2026

Several milestones are scheduled for the year ahead.

Early 2026: The Department for Energy Security and Net Zero will launch a new East Coast Cluster Teesside selection process to identify carbon capture projects for future connection.

Throughout 2026: HyNet and East Coast Clusters will compete for £500 million in hydrogen network funding. The EU is expected to certify its first biochar credits under the Carbon Removal and Carbon Farming Regulation, and the UK has committed to align its methodologies with the EU framework where possible.

By June 2026: The UK must legislate Carbon Budget 7, covering the period 2038 to 2042, which will further define the pathway for carbon removals.

Construction: East Coast Cluster projects are under construction from mid-2025, with operations expected from 2028.

The bottom line

2025 established the UK's carbon removal policy architecture:

  • £21.7 billion committed

  • UK ETS integration timeline set for 2029

  • Business model published

  • Interim methodologies released

  • CCUS clusters reaching financial close

The policy scaffolding exists. 2026 will show whether it can support actual construction and delivery.

For biochar, the outlook is promising. Globally, it already delivers 86% of all durable carbon removal credits and accounts for 92% of retirements. The technology is proven, the supply chains are developing, and the UK has the feedstocks, the land, and the expertise to scale.

Momentum is building. New facilities are coming online. Investment is flowing into UK biochar companies. Buyers from fintech platforms to architecture firms are purchasing verified credits. And verification infrastructure from organisations like CapChar is turning production into credible, tradeable removal.

UK policy support may currently focus on BECCS and DACCS, but the market is not waiting. Every tonne delivered, every certificate issued, and every partnership formed strengthens the case for biochar as a practical, scalable solution that works today.

The policy will catch up. In the meantime, the sector is getting on with the job.

Oluwaseun Sanni
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